[Purpose] The purpose of this study was to compare the effectiveness of cognitive activity combined with active physical exercise for a sample of older adults with dementia. [Subjects] A convenience sample of 30 patients with dementia (Mini-Mental State Examination score between 16 and 23) was used. Participants were randomly allocated to one of two groups: cognitive activity combined with physical exercise CAE, n=11), and only cognitive activity CA, n=9). [Methods] Both groups participated in a therapeutic exercise program for 30 minutes, three days a week for 12 weeks. The CAE group performed an additional exercise for 30 minutes a day, three days a week for 12 weeks. A Wii Balance Board (WBB, Nintendo, Japan) was used to evaluate postural sway as an assessment of balance. The Berg Balance Scale (BBS) and Modified Falls Efficacy Scale (MFES) were used to assess dynamic balance abilities. The Timed Up-and-Go test (TUG) was used to assess gait, and the Digit Span Test (DST) and 7 Minute Screening Test (7MST) were used to measure memory performance. The Mini-Mental Status Exam-Korean version (MMSE-K), Kenny Self-Care Evaluation (KSCE), and Short Geriatric Depression Scale (GDS) were used to assess quality of life (QOL). [Results] There were significant beneficial effects of the therapeutic program on balance (velocity in EOWB, path length in ECNB, BBS, and MMFE), QOL (MMSE-KC, GDS, KSCE), and memory performance (DSB) in the CAE group compared to CA group, and between pre-test and post-test. [Conclusion] A 12-week CAE program resulted in improvements in balance, memory and QOL. Therefore, some older adults with dementia have the ability to acquire effective skills relevant to daily living.